ITHACA, N.Y. — The City of Ithaca has contracted with a financial consulting firm to bring its “severely outdated” accounting system in line with best practices, according to a city memo.
The Bonadio Group was originally contracted to complete the city’s backlog of financial reporting, but upon digging through the city’s financial and record keeping system, the firm’s contract was expanded.
Council members and concerned members of the public have been restless as the city has struggled to catch up on years of delayed audits. The city’s most recently completed audit was for fiscal year 2021.
City officials previously attributed the acute delays to staffing challenges, turnover and outdated accounting practices. However, those explanations were followed by further delays.
City officials said in April 2024 they expected the 2021 audit to be completed by June of 2024. It took until August 2025 for that audit to be completed.
As a result of the backlog of audits, the city’s credit rating was withdrawn in March 2024 by the ratings firm Moody’s. Without a credit rating, the city is paying higher interest rates when it issues debt, although so far the rates have remained comparable to previous rates the city has received.
Acting City Manager Dominick Recckio wrote in a Jan. 16 memo to Common Council the Bonadio Group identified “deficiencies” in the city’s financial reporting system, which prevented an “accurate audit from being performed.”
During a Jan. 21 council meeting, Recckio said one of the obstacles that Bonadio identified preventing the city from “embarking on the 2022 audits” were new reporting requirements from the Governmental Accounting Standards Board (GASB), an independent, nonprofit regulatory body that sets financial reporting standards for state and local governments.
Recckio also said the Bonadio Group will also provide additional training to city staff on MUNIS, the city’s main financial and payroll software.
Mayor Robert Cantelmo said he appreciated the “transparency” with which Recckio discussed the progress on the city’s audits and called the choice to contract the Bonadio Group a “strong step in the right direction.”
The grating progress of the city’s audits appears to have been one of the major sticking points between former City Manager Deborah Mohlenhoff and Common Council. The council requested Mohlenhoff resign from her post at the end of 2025 in order to pursue new leadership.
Mohlenhoff oversaw the city’s adoption of the finance software OpenGov in order to modernize the city’s budget system.
Read the original at The Ithaca Voice.
